Uh oh: Only 5-15% of enrollees have paid their first month of premiums in some ObamaCare plans

A good way to tell whether a media outlet is serious about ObamaCare reporting is to see if they cover this bombshell as a corollary to the new enrollment data. If 365,000 have “signed up” but only one-tenth of them, say, have paid their first month of premiums to activate their new coverage, how many people are really “enrolled” in ObamaCare plans right now?

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Last week an insurer in Indiana told CNN that one of their plans had received payment from only 20 percent of people who signed up so far. According to Charles Ornstein’s sources, that insurer was doing relatively well.

“There is also a lot of worrying going on over people making payments,” industry consultant Robert Laszewski wrote in an email. “One client reports only 15% have paid so far. It is still too early to know for sure what this means but we should expect some enrollment slippage come the payment due date.”

Another consultant Kip Piper, agreed. “So far I’m hearing from health plans that around 5% and 10% of consumers who have made it through the data transfer gauntlet have paid first month’s premium and therefore truly enrolled,” he wrote me…

Blue Shield of California said it has sent out thousands of payment request letters…

While saying it is difficult to guess what will happen, Piper said he believes “a plan will be lucky if half of applicants pay first month’s premium on time for January coverage start but that perhaps three-quarters will pay in time for coverage start by February or March.”

My pal Karl pointed out on Twitter that Ezra Klein’s blog is describing the 365,000 sign-ups announced by HHS today as people who “have purchased private insurance.” Simply not true, and it’s no minor detail that it isn’t. Remember, per the CNN article last week, failing to pay by the deadline this month doesn’t necessarily mean that your coverage will take effect next month as soon as you finally pony up with your first premium. In some states, your enrollment is void if you don’t complete the purchase on time. That means you’ll have to re-enroll in January, which might be an easy process or might not be depending upon whether Healthcare.gov can handle the growing traffic load and whether insurers are buried under a mountain of backlogged applications, some of them with errors that require correction.

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I’m frankly surprised that HHS hasn’t started ringing alarm bells about the nonpayment problem in order to try to mitigate it. I can only assume, as with so much else, that that’s a political decision made at the expense of a policy one. The more they start screaming about paying on time, the more the media will start focusing on this as the next landmine to detonate, replete with another look at how pricey some of America’s new “affordable” coverage is. Better to keep quiet, let people not pay, and then seek some form of “fix” next month in which HHS covers the first month of payments for new enrollees in return for repayment at a later date. Or maybe the easier fix would be for the King to proclaim that no enrollments will be voided in the event of nonpayment. They’ll simply be suspended until payment is tendered. That would reduce the logistical complexity of all this — a little — but I don’t know how insurers will replace the missing revenue in January from all those delayed premiums. Maybe that’s where Uncle Sam and “risk corridors” come in.

Elsewhere in ObamaCare chaos news, go read this USA Today report from Monday about how the new and allegedly improved Healthcare.gov is telling some people who make $80,000 a year that they qualify for Medicaid. When those people call the O-Care hotline, the operators tell them that whatever the website says must be correct. Will those poor saps be sprung from limbo in time to enroll before the deadline? Stay tuned.

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Update: Sebelius was asked about this at today’s House hearing. Quote:

Burgess: What if that patient doesn’t make the premium payment? You said they’re covered Dec. 23, but they never write the check. They never make the payment.

Sebelius: Then they’re not covered. They are not enrolled, and at every point along the way, on the website they are told until they make the payment—

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